<h3>Bias and timeframes</h3>
<p>Near-term bias: neutral-to-cautious on high multiple AI/semiconductor longs. Tactical bias: favor cyclical/cash-flow-positive sectors (financials, industrials) on confirmed strength.</p>
<h3>Trigger zones & tactical rules</h3>
<ul>
<li>If Nasdaq 100 confirms a close below the 20-day EMA after a tariff headline, raise hedges / reduce size on long AI exposure. Use 1–2% daily ATR sizing per position for tight risk control.</li>
<li>Look to initiate selective long exposure to regional banks or small-caps on two conditions: (A) Russell 2000 closes > prior 3-session high, and (B) breadth (advancers/decliners) turns positive for two sessions. Entry = breakout close; stop = 1.25× ATR under breakout.</li>
<li>Use options to hedge large tech exposure: buy 2–4 week puts or invert via call spreads to limit carry cost. If you prefer cash trades, hold a 1–3% portfolio cash buffer to add on confirmed dip-buy signals.</li>
</ul>
<h3>Risk considerations</h3>
<p>Headlines (tariffs, export controls) can produce fast moves. Liquidity in options on mega-cap tech is deep — use it for hedges. If you trade size on small-caps, expect wider intraday spreads and occasional gapping moves around news.</p>
<p>And if you want to act fast: use <a href="https://tradingwizard.ai/app/analyze">Chart Analyzer</a>, scan opportunities in <a href="https://tradingwizard.ai/app">the app</a>, automate alerts via <a href="https://tradingwizard.ai/app/bots">Algo AI Trading Bots</a>. Check <a href="https://tradingwizard.ai/pricing">pricing</a> or learn more at our <a href="https://tradingwizard.ai/academy">academy</a>.</p>
Back to Academy
Insights
Trading Tech Pullback After October Trade Shock: Plan & Triggers
TradingWizard
AI-generated
10/22/2025
6 min read